Barry O'Sullivan (Queensland, National Party) Share this | Link to this | Hansard source

My question is to the Minister for Resources and Northern Australia, Senator Canavan. Could the minister inform the Senate of the current state of the mining and resources sector in Australia and of the benefits it brings to Australians?

Matthew Canavan (Queensland, Liberal National Party, Minister for Resources and Northern Australia) Share this | Link to this | Hansard source

Thank you, Senator O'Sullivan, for your question. The mining sector remains of incredible importance to our national economy. As the Minister for Finance was saying earlier in question time, our economy remains strong—one of the strongest in the world. We have had a period of almost unprecedented continual economic growth in this country. A lot of that is, of course, due to the strength of our resources sector.

It remains a very resilient sector. It is a sector that has gone through a massive change and a boom, but that now, thanks to that investment boom, is bigger than it has ever been—at least since the war. It is going to be a bigger deal in our economy going forward because of that investment. The starkest statistic that shows this is that before the boom fewer than 100,000 people were employed in the sector and now more than 200,000 Australians owe their jobs to the mining sector.

Last week I was fortunate enough to be in Senator Cormann's spot over there in the Pilbara and I was taken around in a bus by a guy called Tony. Tony grew up in Newman, a small town in the Pilbara region, and he has been able to stay in Newman, thanks to the benefits of the iron ore industry and having a job there. He loves it there in Newman. It gives him a chance to go camping there. It is a beautiful part of our country, and he is able to stay there because he has something to do from Monday to Friday by working in the iron ore sector.

It is an incredibly resilient sector, too. It has gone through tough times, with the lower prices at the moment, but one thing we should reflect on is that, in the last financial year, productivity in the resources sector increased more than 20 per cent. Labour productivity is up by more than 20 per cent—a remarkable achievement from a strong sector of our economy. Multifactor productivity, which takes into account capital investments, is up five per cent—a very strong result, contributing to our strong economic performance over the past year. Of course, while prices have been low, they have bounced back lately. Met coal prices are up over 100 per cent, thermal coal prices are up 20 per cent and iron ore has stayed stable. It is a strong sector and it is continuing to contribute to our very strong economy.

Stephen Parry (President) Share this | Link to this | Hansard source

Senator O'Sullivan, a supplementary question.

Barry O'Sullivan (Queensland, National Party) Share this | Link to this | Hansard source

Can the minister explain what the government is doing to promote further mining investment?

Matthew Canavan (Queensland, Liberal National Party, Minister for Resources and Northern Australia) Share this | Link to this | Hansard source

One of the consequences of those lower prices I mentioned—although they have come off lows—is that the first thing that gets cut is exploration for new resources. In this environment, companies will typically cut back on exploration, and exploration investment is down more than 30 per cent in some of our resources sectors. That is why the government is responding to fill that gap—or at least partly fill that gap—by doing some of our own exploration, which we already do through Geoscience Australia. They do fantastic work.

In the budget before the election we announced that we had put another $100 million into this environment, in the Exploring for the Future program, to look at areas of our country that are unexplored that might have the next big new find. That happened in the Browse Basin in the 1990s. Geoscience Australia found those resources with only a $3 million dollar initial spend—now that is a multibillion dollar project for our nation. That is what we hope to achieve, and that is why the government are supporting the sector by trying to find new resources and to create just as much of a boom as we have had. (Time expired)

Stephen Parry (President) Share this | Link to this | Hansard source

Senator O'Sullivan, a final supplementary question.

Barry O'Sullivan (Queensland, National Party) Share this | Link to this | Hansard source

Can the minister outline to the Senate how these initiatives will benefit regional Australia?

Matthew Canavan (Queensland, Liberal National Party, Minister for Resources and Northern Australia) Share this | Link to this | Hansard source

Of course, almost by definition, all mines are located in regional Australia, but so much of urban Australia owes almost its birth to the resources sector. So many cities around this country owe, if not their birth, their initial growth to the investment that was put in place by mining. Of course, Melbourne is one of the prime examples of that with the goldmining sector. Where I was last week, with Tony—Newman is a mining town and would not be there without the iron ore industry. Where I am from, Rockhampton, was a goldmining town thanks to Mount Morgan, and it now benefits from the coalmining sector in this region.

So many of our regional centres rely on this sector; that is why it is a sector this government supports. We support those sectors of our economy that provide wealth and create jobs, that allow us to have a very prosperous economy and to spend money on services for the wider Australian public, be they hospitals or schools. The mining sector helps pay the bills, and that is why we support it.